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Cape Town - Brian Molefe, Eskom CEO, resigned because he had no credibility left after the Public Protector’s state capture report, said emerging market economist Peter Attard Montalto from the Japanese investment bank Nomura in a statement on Friday.
“His is the first head to roll. Put simply he had no credibility left after the report, regardless of the fact that the information in the report was not proven and only allegations.”
Montalto said Molefe is the “fallen angel” for investors. He left Transnet as a hero and is now implicated in alleged grand corruption and rent extraction by the former Public Protector Thuli Madonsela’s report.
READ: TIMELINE: Brian Molefe's career so far
“In a way it’s sad; in a way its not.” said Montalto. “He ultimately was successful because he could navigate the patronage realities of the ANC but it has caught up with him.”
Montalto cautions that South Africans need to understand the “rot” at Eskom goes much deeper. “The whole board needs to be replaced and there are many others who are also implicated in the report.”
He expects “someone similar” to Molefe to be appointed to head up the power utility.
READ: Molefe has done the right thing by resigning - Yelland
“I do not see this as a positive,” Montalto said. “They will appoint someone equally as willing to facilitate rent extraction and ensure nuclear success and as long as the board and other senior management are in place nothing changes. If the CFO is for example appointed as CEO that is not positive and it would be a sign of the status quo.”
The last "good" CEO, Montalto said, was Tshediso Matona and he left the power utility after just a few months because he was “too clean”.
READ: FULL STATEMENT: Eskom CEO Brian Molefe resigns
“Eskom won't make that mistake again.” The question is if someone “obviously dirty” will be appointed, or if it will be someone like Molefe who appears to be “clean” on the surface, but who has allegedly turned the mechanism of patronage on the surface.
“The level of scrutiny suggests the latter is most likely the case,” he concluded.
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Public Enterprises Minister Lynne Brown regrets the fact that "someone of Brian Molefe's calibre" is leaving Eskom.
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Eskom chair Baldwin Ngubane says the decision by CEO Brian Molefe to resign is regrettable but understandable.
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